On April 8 at 12:19 p.m. (UTC), Bitcoin Cash (BCH) saw its first-ever block reward halving. Due to code built into the blockchain, as block 630,000 of the network was mined, the number of coins issued to miners was cut in half from 12.5 per block to 6.25. BCH miners quickly abandoned the network.
Miners don't work for free. Managing thousands of machines costs time, money, and electricity. Bitcoin Cash's halving resulted in miners immediately losing 50% of their revenue, forcing operators running on tight margins to turn off their machines or mine on other networks, like Bitcoin.
Per cryptocurrency mining data site CoinWarz, both the block difficulty and hash rate of the Bitcoin Cash network went into freefall in the wake of the halving.
Hash rate — the amount of computational power allocated to mining blocks — reached 785 petahashes per second, down 80% from a peak on April 8 of 4,001.5 petahashes per second.
Block difficulty — the dynamic metric describing how computationally hard it is for miners to process blocks — collapsed to 269 billion, down nearly 50% from the peak on April 8 of 528 billion.
Due to the simultaneous drops in both difficulty and hash rate, the security of Bitcoin Cash has come into question, as predicted by LongHash's Kyle Torpey in April of 2019.
According to data from Crypto51.app, a web site that tracks the cost of enacting a so-called "51% attack" on a blockchain to falsify or censor certain transactions, the cost to attack Bitcoin Cash for one hour is a mere $4,250 as of 10:34 p.m. (UTC) on April 9, equivalent to a mere 16.5 BCH at current prices.
For some context, the cost to attack the original Bitcoin network for the same period of time, the web site estimates, would be $620,000 — 14,400% higher. The cost to attack Ethereum for one hour is $90,517, a whole order of magnitude higher than BCH.
Crypto51 obtains this data by calculating what it would cost to rent enough mining power to control 51% of a network, based on the cost of renting computational power through NiceHash. Importantly, NiceHash alone does not have access to enough machines to process the large requests required to temporarily take over a leading blockchain, but the point of the site is to quantify how secure a network is.
With a 51% attack, a central attacker can effectively take over a blockchain, allowing them to reverse and censor certain transactions. An exchange or service provider accepting the coin of a blockchain under attack is susceptible to losses as the attacker could “deposit” coins onto a platform to get account credit, then reverse the transfer, allowing them to effectively double their money.
Next up on the halving chopping block, so to speak, is Bitcoin Satoshi's Vision (BSV), the fork of BCH led by nChain and Craig Wright. According to blockchain explorers tracking BSV, there are 18 blocks until the network's first halving at block 630,000, which corresponds with approximately three hours worth of mining from the time of this article's publishing.